Apple is now worth $5.2 trillion, up from $350 billion when Tim Cook became CEO. John Ternus takes over a larger company, and matching Cook's returns over the next 15 years is almost certainly out of reach. The stock may still beat the market, according to The Motley Fool.
Apple's market cap has reached $5.2 trillion, up from $350 billion when Tim Cook took over. The company was worth about $4.6 trillion when Cook ended his tenure as CEO at the end of August. John Ternus now leads the company.
Cook's legacy gives Ternus a tough benchmark
Cook became CEO in 2011, four years after the first iPhone was released. He oversaw the launch of products such as the Apple Watch and the AirPods. He also turned Apple's installed base into a cash-generating business through paid subscriptions across more than a dozen services.
Services is now Apple's second-largest segment by sales, and it carries higher margins than hardware, according to the article. Ternus inherits more than 2.5 billion active devices in circulation.
Repeating Cook's run is unlikely, however. Matching it would put Apple at over $60 trillion in 15 years, nearly twice the U.S. GDP of just under $31 trillion last year.
iPhone 17 and the foldable iPhone Duo drive the case for the stock
Apple has been the best-performing Magnificent Seven stock this year. The article credits the iPhone 17, introduced last year, with powering a strong renewal cycle.
Apple announced the iPhone Duo, its first foldable smartphone, in September. The device sold out quickly, and Apple faces supply constraints. Foldables account for just 2% of the overall smartphone market, according to some data, so a device priced above other iPhone models may help lift sales growth in the medium term.
Some risks remain. There have been reports of cracking screens on the first-generation iPhone Duo, though the article calls these cases rare. Apple is also reportedly working on new devices, including smart glasses, and does not need all of them to succeed.
The article adds that Apple prioritizes returning capital to shareholders through dividends and share buybacks. Its conclusion is that Apple may not match the returns of Cook's tenure, but can still deliver market-beating returns.
Source: The Motley Fool
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